【Cheung Kong Group】CK Infrastructure Reportedly Seeks HK$10.4 Billion Bridge Loan to Bid for Macquarie UK Smart Meter Assets

Bloomberg citing sources reported that China State Construction Engineering Corporation (01038) is seeking a £1 billion bridge loan (approximately HKD 10.43 billion) to finance the acquisition of UK smart meter assets held by Macquarie Group.

Sources said that Macquarie Group’s Macquarie Commodities and Global Markets has invited bidders, including China State Construction, to compete for its gas and electricity smart meter assets; China State Construction has already been in talks with multiple banks regarding the potential financing. Since China State Construction may be seeking additional funds for other corporate purposes, the loan amount could be larger.

The report also indicated that discussions are still ongoing, and China State Construction may decide to withdraw from the bidding. Representatives from Macquarie and China State Construction declined to comment.

What is a bridge loan?

A bridge loan is a short-term, transitional loan typically lasting from a few weeks to a year, acting as a temporary bridge to help borrowers smoothly transition from a “funding gap” to the availability of long-term funds. Simply put, when someone needs a large sum of money and expects to receive funds soon but needs to use money immediately, a bridge loan is the emergency solution. Due to its higher risk and convenience, its interest rates are usually higher than those of long-term secured loans.